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Cabinet approves an NHI bill which is thin on details

The bill does not provide any details about how NHI will be financed, leaving that to the Treasury to determine.

08 June 2018 - 13:53
Tamar Kahn

Picture: 123RF/LANGSTRUP

Cabinet has approved the long-awaited National Health Insurance (NHI) Bill, the government’s first and most crucial piece of legislation for implementing its goal of universal healthcare.

NHI aims to provide healthcare to everyone that is free at the point of delivery, financed in a way that sees the healthy and wealthy subsidise the poor and the sick.

The bill, which was approved by the Cabinet last Wednesday, has yet to be published in the Government Gazette.

But Business Day understands from several independent sources that it closely follows the Department of Health’s second NHI white paper, which was released in 2017. Health Minister Aaron Motsoaledi declined to comment on the bill, saying he would do so at a media briefing in due course.

The bill does not provide any details about how NHI will be financed, leaving that to the Treasury to determine.

Instead, it sets out the legal mechanism for establishing an NHI Fund, which will purchase services from accredited public and private healthcare providers. Accreditation will be provided by the Office of Health Standards Compliance, which will be implementing a new set of norms and standards in 2019 that include the private sector for the first time.

The bill creates a system for registering beneficiaries, which for South Africans will be based on their identification numbers, and contains provisions that enable the fund to provide differentiated services to noncitizens.

The potentially controversial details of what benefits the fund will cover and how it will reimburse service providers are not spelt out in the bill. That task is instead delegated to a series of ministerial advisory committees, which include an appeal committee.

The work of the ministerial advisory committee on pricing will be closely watched by the private sector, as the white paper says NHI will gradually shift from the current fee-for-service model to alternative reimbursement models.

This could mean that a doctor could be paid a fixed fee to provide primary healthcare services to a specified number of patients, rather than being reimbursed separately for each service provided to a patient.

The sector is also keenly awaiting the release of the health market inquiry’s provisional report on June 28. The inquiry was established by the Competition Commission to determine whether there are barriers to effective competition and access to services in the private healthcare industry.

Observers are particularly interested in what it has to say about private sector pricing and whether it will recommend establishing a mechanism for price control.

The bill also sets out the fund’s governance structure, including the composition of its board. The fund will be headed by a CEO and will report to the minister of health.

It is expected to be released for public comment at the same time as the Medical Schemes Amendment Bill. The two bills go hand in hand as the department wants schemes to provide a set of mandatory minimum benefits that match those covered by NHI.

The minister previously told Business Day that the NHI Bill was essentially “a legalisation of the white paper” and that far bigger changes were in the offing with the Medical Schemes Amendment Bill.

It is understood that the department regards the Medical Schemes Amendment Bill as an interim measure to ensure consumers are protected as it gradually rolls out NHI.